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B is for Bookkeeping

Hello, and welcome to the April A-Z Blogging Challenge! Over the first 26 days of April, we will explore aspects of writing and marketing books – authors, feel free to weigh in, and readers, feel free to observe and ask questions!

-M

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It can be so remarkably tempting, as an author, to take shelter in the trope of the vague, creative genius. The truth is, however, that it’s a very rare person who finds accounting fun – and on the flip side, almost everyone finds crushing debt un-fun. Therefore, let’s look at some really, REALLY easy ways to manage the expenses of being an author…because those can get a bit less clear-cut than one might think.

Keep track of advertising expenses, and weigh markets against one another. If you ascribe to the idea that one should try to reach new readers via advertising (and for what it’s worth, at least one very successful writer doesn’t think that), it can be easy to drop hundreds of dollars without seeing much return. With that in mind…

Take some dedicated time to research all of the available marketing options you have, including book-of-the-day email lists, book review blogs (double whammy here, as some email lists require a certain amount of reviews), facebook groups, and banner ads. List them all in a document, with the cost and estimated reach (if you can’t find this on the website, it’s actually a pretty good sign that you shouldn’t advertise with them). Then go hunting for reviews from other authors, making note of relevant genres (for instance, maybe mysteries tank on one list, but fantasy gets great results).

Keep track of what you’ve spent and when the promos are running so that you can remember your OWN results. This will help you with your next books.

Make sure you know when you’ll be paid. Relevant to any project, indie or traditional. Many marketplaces pay each month, on a two-month lag. Smashwords, however, pays quarterly. Don’t commit to new contracts until you know just when your royalties will be coming in.

Make sure you know where all the money is coming from for each book. Below is an informal list of expenses I use to keep track of just how much I’m intending to spend:

Copyright fee – $35

Cover art

Editing

Formatting (not one I use, but many people do)

Pre-release and first-week promos

Any giveaway copies (paperback or ecopies – it can help to gift things through Amazon so that the reviews are verified) and shipping costs

Consider setting up special bank accounts. One of the weirdest-feeling parts of starting a career is that it helps to act as if you’re wildly successful, just in case. Setting up a facebook fan page before you have fans? Ridiculous, but worth it. Likewise, setting up an LLC or SP, and getting bank accounts for this, can be insanely helpful. It lets you know exactly where your money is coming from and where it’s going.

Also consider hiring a tax preparer. See above. It may seem unnecessary, but it’s definitely something to consider. Put all your authorly receipts in a folder, and at least track down a few phone numbers. If you get wildly successful overnight, wouldn’t you rather be reveling and eating bon-bons than panicking about taxes and trying to find receipts? Yes. Yes, you would.